SEPARATION AGREEMENT AND GENERAL RELEASE
SEPARATION
AGREEMENT AND GENERAL RELEASE
Brookdale Senior Living Inc., 000 Xxxxx
Xxxxxx Xxxxxx, Xxxxx 0000, Xxxxxxx, XX 00000, (including affiliates and its
successors, assigns, employees, officers, directors, representatives,
shareholders and agents, collectively referred to as "Brookdale"),
and Xxxx X. Xxxxxxx ("Employee")
have entered into this Separation Agreement and General Release (this "Agreement")
on this 7th day of
February, 2008 (collectively referred to as the "Parties").
In consideration of the mutual promises contained herein, the Parties agree as
follows:
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1.
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Notice of Termination;
Certain Position Resignations. As required by Section 5
of his Employment Agreement with Brookdale and Brookdale Living
Communities, Inc. made as of August 9, 2005 (the "Employment Agreement"),
the Employee hereby gives notice to the Company that he will terminate his
employment on March 3, 2008 (the "Termination Date"). As agreed
between the Parties, the Employee hereby resigns his position as Co-Chief
Executive Officer of Brookdale, effective immediately. Employee
also agrees that, effective immediately, he resigns all of his positions
as an officer, director, manager, governor or employee of Brookdale or any
parent, subsidiary or affiliate at any level, and he agrees to promptly
execute such customary documents and take such customary actions as may be
necessary or reasonably requested by Brookdale to effectuate or
memorialize the termination of such positions; provided, however, that
such resignation shall not apply to Employee's service as a member of the
Board of Directors of Brookdale or to Employee's service as a key employee
of Brookdale pursuant to Section 2
hereof.
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2.
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Continued Service as
Key Employee; Restricted Shares. The Employee agrees to
serve Brookdale as a key employee until the Termination Date, on which
date his employment and the Employment Agreement shall
terminate. Brookdale agrees to cause the Administrator of the
Brookdale Senior Living Inc. Omnibus Stock Incentive Plan, as Amended and
Restated June 12, 2007 (the "Plan") to accelerate the vesting of all of
the Employee's outstanding restricted shares of Company stock under the
Plan or any predecessor plan and cause the restrictions on all of the
Employee’s restricted shares to lapse on the Termination Date, if (and
only if) the Employee continues to serve Brookdale as a key employee until
the Termination Date, terminates his employment on the Termination Date,
and executes and delivers to Brookdale a Final Separation Agreement
substantially in the form attached hereto as Exhibit A on the Termination
Date. The accelerated vesting shall apply to all restricted
shares outstanding under his Award Agreement dated as of August 9, 2005
(the "2005 Agreement") and his Restricted Share Agreement dated as of
March 7, 2007 (the "2007 Agreement"). The Employee agrees that
he shall not transfer the newly vested shares, except to the extent
required to pay taxes with respect to such vesting, before March 3,
2009.
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3.
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Last Day of
Employment. Employee and Brookdale agree that Employee's employment
with Brookdale will be terminated by Employee on March 3, 2008 (the
"Termination Date"), and that Employee has given prior notice to Brookdale
in accordance with his Employment Agreement. Brookdale will
reimburse Employee for all business
expenses
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incurred
on behalf of Brookdale through the Termination Date, in accordance with
Brookdale's policies with respect to the reimbursement of expenses.
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4.
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Restrictive Covenants;
Cooperation. The Employee agrees that the restrictive
covenants of Sections 15 and 16 of the 2005 Agreement and Sections 12 and
13 of the 2007 Agreement relating to non-competition, non-solicitation of
employees, clients and others, non-disparagement and confidentiality are
incorporated by reference herein and shall continue to apply for the
longer of (i) the periods specified therein or (ii) the period ending nine
months after the date he is no longer serving Brookdale either as an
employee or as a member of Brookdale's Board of Directors. On
reasonable request, Employee will cooperate in all reasonable respects
with Brookdale and its affiliates in connection with any and all existing
or future litigation, actions or proceedings (whether civil, criminal,
administrative, regulatory or otherwise) brought by or against Brookdale
or any of its affiliates, to the extent Brookdale reasonably deems
Employee’s cooperation necessary (taking into account Employee’s other
commitments). Employee shall be reimbursed for all reasonable
out-of-pocket expenses he incurs (including, without limitation,
reasonable attorney fees).
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5.
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Special Benefits and
Payments. Effective as of the Termination Date, Employee
will cease all Brookdale health benefit coverage as an employee and other
employee benefit coverage. Brookdale is amending its health benefit
coverage to include non-employee directors who are former executive
officers of Brookdale. Subject to this Agreement having been
completely executed and the revocation period described in Section 20
hereof having passed without any revocation, Brookdale agrees to provide,
at Brookdale's expense, continued group health plan coverage for Employee
and Employee's eligible dependents (to the extent so elected), subject to
co-payments and deductibles applicable to active employees of
Brookdale. The obligations of Brookdale set forth in the
immediately preceding sentence shall become effective as of the
Termination Date and shall continue to apply for the longer of (i) the
period ending on the date that Employee ceases to serve as a non-employee
member of Brookdale's Board of Directors or (ii) the period ending on
March 3, 2009. Employee acknowledges that the benefits
and payments described in this Section are in addition to any amounts to
which Employee is already entitled (without the execution of this
Agreement) and that these payments and benefits provide adequate and
satisfactory consideration for the assurances made by Employee in this
Agreement, including, without limitation, the general release of claims
given in Section 7 hereof.
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6.
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Final Separation
Agreement. If (and only if) Employee's employment is
terminated in accordance with the first sentence of Section 1 hereof,
Employee will be asked to execute a Final Separation Agreement
substantially in the form attached hereto as Exhibit A on the Termination
Date; however, the provisions of this Agreement are not contingent upon
Employee's execution of the Final Separation Agreement. If (and
only if) Employee executes the Final Separation Agreement on the
Termination Date and delivers it to Brookdale on the Termination Date in
accordance with the second sentence of Section 2 hereof, the vesting of
his outstanding restricted shares of Brookdale under the 2005 Agreement
and the 2007 Agreement shall be accelerated, their restrictions shall
lapse, and they shall be delivered to Employee on the Termination Date
(the "Final Separation
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Payment"). Their
vesting and delivery shall not be delayed until the end of the revocation period
described in the Final Separation Agreement.
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7.
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Employee General
Release of Claims. Employee for Employee, Employee's estate,
Employee's heirs, family members, successors and assigns hereby
voluntarily, knowingly and willfully forever releases and discharges
Brookdale and its affiliates, successors, assigns, employees, officers,
directors, representative, shareholder agents and all persons acting by,
through, under or in concert with any of the foregoing in both their
official and personal capacities (the "Releasees") from any and all
claims, whether or not known, accrued, vested or ripe (hereinafter,
"Claims"), that Employee has or may have against the Releasees arising
from or in any way related to Employee's employment with Brookdale or any
affiliate thereof up to and including the date of Employee's execution of
this Agreement or the termination of that employment relationship in
accordance with the contractual provisions of this Agreement, including,
but not limited to, any such claim for an alleged violation of any or all
federal, state and local laws and anti-discrimination laws or the
following statutes and court-made legal
principles:
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o
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Title
VII of the Civil Rights Act of 1964, as amended;
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o
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The
Civil Rights Act of 1991;
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o
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The
Equal Pay Act;
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o
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Any
claim arising under the provisions of the False Claims Act, 31 U.S.C.A. §
3730, including, but not limited to, any right to personal gain with
respect to any claim asserted under its "qui tam"
provisions;
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o
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Sections
1981 through 1988 of Title 42 of the United States Code, as
amended;
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o
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The
Employee Retirement Income Security Act of 1974, as
amended;
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o
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The
Immigration Reform and Control Act, as amended;
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o
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The
Americans with Disabilities Act of 1990, as amended;
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o
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The
Age Discrimination in Employment Act of 1967, as
amended;
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o
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The
Workers Adjustment and Retraining Notification Act, as
amended;
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o
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The
Occupational Safety and Health Act, as amended;
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The
Fair Labor Standards Act of 1938, as amended;
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The
Illinois Human Rights Act, as amended;
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The
Municipal Code of Chicago, as amended;
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any
other federal, state or local civil or human rights law or any other
local, state or federal law, regulation or
ordinance;
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o
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any
claims arising out of or related to an express or implied employment
contract (including, without limitation, the Employment Agreement) or a
covenant of good faith and fair dealing;
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o
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any
public policy, contract, tort, or common law; or
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any
allegation for costs, fees, or other expenses including attorneys' fees
incurred in these matters.
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Notwithstanding
the foregoing, nothing in this Agreement shall release or waive any rights
or claims Employee may have: (i) under this Agreement; (ii) for
indemnification under any written indemnification agreement by and between
Employee and Brookdale and/or under applicable law or Brookdale's charter
or bylaws; (iii) under any applicable insurance coverage(s) (including,
without limitation, COBRA rights); (iv) with respect to any accrued and
vested benefits under any tax-qualified retirement plans; or (v) any claim
that cannot be waived or released by a private agreement (including the
right to seek a determination of the validity of the waiver of Employee's
rights under the federal Age Discrimination in Employment Act of 1967
("ADEA")). Additionally, nothing in this Agreement shall be construed to
prohibit Employee from filing any charge or participating in any
investigation or proceeding conducted by the Equal Employment Opportunity
Commission or a comparable state or local agency. Notwithstanding the
foregoing, Employee waives his right to recover monetary damages relating
to any such charge, complaint, or lawsuit filed by Employee or anyone on
Employee's behalf.
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8.
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Brookdale
Release. Brookdale for itself, its officers, directors, successors,
affiliates, agents, employees and assigns, both in their individual and
representative capacities, hereby voluntarily, knowingly and willfully
forever releases and discharges Employee, Employee's agents, attorneys,
representatives, heirs and assigns from any and all claims, whether or not
known, accrued, vested or ripe, that Brookdale has or may have against
Employee arising from or in any way related to Employee's service with
Brookdale or any of its affiliates up to and including the date of
execution of this Agreement or the termination of that employment
relationship in accordance with the contractual provisions of this
Agreement, including, but not limited to, any such claim for an alleged
violation of any federal, state or local law, regulation or ordinance; any
claims arising out of or related to an express or implied employment
contract (including, without limitation, the Employment Agreement) or a
covenant of good faith and fair dealing; any public policy, contract,
tort, or common law; or any allegation for costs, fees, or other expenses
including attorneys' fees incurred in these matters. Notwithstanding the
foregoing, nothing in this Agreement shall release or waive any rights or
claims Brookdale may have (i) under the terms of this Agreement, (ii)
under the terms of that certain Secured Non-Recourse Promissory Note dated
as of October 2, 2000 (as amended to date) evidencing a loan from
Brookdale and/or one of its affiliates to Employee, which the parties
acknowledge shall remain outstanding and unmodified by the terms of this
Agreement, or (iii) as a result of any unlawful or fraudulent conduct by
Employee.
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9.
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Affirmations.
Employee and Brookdale each affirm that neither has filed, caused to be
filed, or presently is a party to any claim, complaint, or action against
the other in any forum or form. Employee furthermore affirms
that Employee has no known workplace injuries or occupational diseases,
and has been provided and has not been denied any leave requested under
the Family and Medical Leave Act. Employee disclaims and waives any right
of reinstatement with Brookdale.
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10.
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COBRA. Employee
acknowledges that Brookdale has advised Employee that, if he serves
Brookdale as a non-employee director after his employment termination,
then, pursuant to the Consolidated Omnibus Budget Reconciliation Act of
1985 ("COBRA"), he will have a right to elect continued coverage under the
Brookdale group health plan for a period of eighteen (18) months from the
date his service as a non-employee director
ceases.
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11.
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'34 Act Filing.
Brookdale will disclose the existence and terms and will file this
Agreement with the Securities and Exchange Commission in satisfaction of
its reporting obligations under the Securities Exchange Act of 1934, as
amended. The Form 8-K to be filed to which this Agreement shall be
attached as an exhibit and any press release issued in connection with
Employee's departure from Brookdale shall first be furnished to Employee
with an opportunity for Employee to comment, and Brookdale will attempt in
good faith to provide Employee with an opportunity to review any changes
or additions to any such disclosure in any other public filings or
disclosure in advance.
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12.
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Litigation
Matters. With respect to any and all existing or future
litigation, actions or proceedings (whether civil, criminal,
administrative, regulatory or otherwise) brought against Employee in
connection with his employment by Brookdale, Brookdale will honor, and
proceed in accordance with, its Bylaws and its Indemnification Agreement
with Employee entered into in November 2005, which will survive and
continue in effect in connection with Employee’s service as a member of
Brookdale’s Board of Directors.
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13.
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Return of Personal
Property. Brookdale promises to return to Employee all items of
personal property located at Brookdale's business premises prior to the
Termination Date. Employee promises to return to Brookdale all
items of Brookdale property in Employee's possession no later than the
Termination Date.
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14.
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Notices. All
notices, demands, consents or communications required or permitted
hereunder shall be in writing. Any notice, demand or other communication
given under this Agreement shall be deemed to be given if given in writing
(including facsimile or similar transmission) addressed as provided below
(or at such other address as the addressee shall have specified by notice
actually received by the sender) and if either (a) actually delivered in
fully legible form to such address or (b) in the case of a letter, five
(5) days shall have elapsed after the same shall have been deposited in
the United States mail, with first-class postage prepaid and registered or
certified:
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To
Employer:
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000
Xxxxxxxx Xxxxx, Xxxxx 000
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Xxxxxxxxx,
XX 00000
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Attention:
General Counsel
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With
a copy to:
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Xxxxxxx
Xxxx, Slate, Xxxxxxx & Xxxx LLP
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0
Xxxxx Xxxxxx
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Xxx
Xxxx, XX, 00000-0000
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Fax:
(000) 000-0000
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Attention:
Xxxxxx X. Coco, Esq.
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To
Employee:
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Xxxx
X. Xxxxxxx
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At
address currently on Brookdale's records
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With
a copy to:
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XxxxXxxxx
Xxxxx & Xxxxx LLP
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000
X. Xxxxxx Xxxxx, Xxxxx 0000
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Xxxxxxx,
XX 00000
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Attention:
Xxxxxxx X. Xxxxx
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00.
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Governing Law and
Interpretation. This Agreement shall be governed and controlled by
and in accordance with the laws of the State of Delaware without
regard to its conflict of laws provision. In the event Employee or
Brookdale breaches any provision of this Agreement, Employee and Brookdale
affirm that either may institute an action to specifically enforce any
term or terms of this Agreement. Venue for any action brought to enforce
the terms of this Agreement or for breach thereof shall lie in any court
of competent jurisdiction in Chicago, Illinois. Should any provision of
this Agreement be declared illegal or unenforceable by any court of
competent jurisdiction and cannot be modified to be enforceable, excluding
the general release language, such provision shall immediately become null
and void, leaving the remainder of this Agreement in full force and
effect. The Parties affirm that this Agreement is the product of
negotiation and agree that it shall not be construed against either Party
on the basis of sole authorship.
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16.
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Nonadmission of
Wrongdoing. The Parties agree that neither this Agreement nor the
furnishing of the consideration for same shall be deemed or construed at
any time for any purpose as an admission by either Party of any liability,
wrongdoing or unlawful conduct of any
kind.
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17.
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Amendment. This
Agreement may not be modified, altered or changed except upon express
written consent of both Parties wherein specific reference is made to this
Agreement.
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18.
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Entire
Agreement. This Agreement sets forth the entire agreement between
the Parties hereto and fully supersedes any prior agreements or
understandings between the Parties (including the Employment Agreement),
except the Indemnification Agreement,
and
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except as
certain provisions of other prior agreements are specifically incorporated by
reference herein. Each Party acknowledges that it has not relied on any
representations, promises, or agreements of any kind made to it in connection
with the other Party's decision to enter into this Agreement, except for those
set forth in this Agreement.
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19.
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Payments and
Withholding. The Parties agree that, if Employee's death
precedes the time of certain payments being made hereunder, such payments
shall be made to Employee’s estate. All payments hereunder
shall be subject to Brookdale's normal practices in complying with
applicable withholding requirements, unless Employee provides evidence
satisfactory to Brookdale that all applicable requirements can be complied
with in a different manner, for example, by Employee's direct payments to
the taxing authorities.
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20.
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Revocation.
Employee may revoke this Agreement for a period of seven (7) calendar days
following the day that Employee executes this Agreement. Any revocation
within this period must be submitted, in writing, to Brookdale Senior
Living Inc., 000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx,
XX 00000, as follows: "I hereby revoke my acceptance of our
Agreement." The revocation must be personally delivered to Brookdale's
General Counsel or mailed to his office at the above address and
postmarked within seven (7) calendar days of execution of this Agreement.
This Agreement shall not become effective or enforceable until the
revocation period has expired without any revocation taking
place. If the last day of the revocation period is a Saturday,
Sunday, or legal holiday, then the revocation period shall not expire
until the next following day which is not a Saturday, Sunday, or legal
holiday.
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EMPLOYEE
HAS BEEN ADVISED THAT EMPLOYEE HAS UP TO TWENTY-ONE (21) CALENDAR DAYS TO REVIEW
THIS AGREEMENT AND THE GENERAL RELEASE CONTAINED HEREIN AND HAS BEEN ADVISED IN
WRITING TO CONSULT WITH AN ATTORNEY PRIOR TO EXECUTION OF THIS
AGREEMENT.
EMPLOYEE
AGREES THAT ANY MODIFICATIONS, MATERIAL OR OTHERWISE, MADE TO THIS AGREEMENT DO
NOT RESTART OR AFFECT IN ANY MANNER THE ORIGINAL TWENTY-ONE (21) CALENDAR DAY
CONSIDERATION PERIOD.
HAVING
ELECTED TO EXECUTE THIS AGREEMENT, TO FULFILL THE PROMISES CONTAINED HEREIN AND
TO RECEIVE THE CONSIDERATION SET FORTH HEREIN, EMPLOYEE KNOWINGLY AND
VOLUNTARILY, AND AFTER DUE CONSIDERATION, ENTERS INTO THIS
AGREEMENT.
[Remainder
of Page Intentionally Left Blank]
7
IN
WITNESS WHEREOF, the parties hereto knowingly and voluntarily executed this
Agreement on the date first written above:
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By:
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/s/
W.E. Sheriff
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Name:
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W.E.
Sheriff
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Title:
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Co-Chief
Executive Officer
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EMPLOYEE
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By:
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/s/
Xxxx X. Xxxxxxx
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Xxxx
X. Xxxxxxx
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8
Exhibit
A
Final
Separation Agreement
This will confirm the understanding of
"Employee" and "Brookdale" (as defined in the Separation Agreement and General
Release entered into between them on February 7, 2008 (the "Separation
Agreement") and their final agreement (this “Final Separation Agreement”) with
respect to the termination of Employee's employment with Brookdale:
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1.
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A
form of this Final Separation Agreement was attached to the Separation
Agreement. The Separation Agreement (including, but not limited
to the release of all Claims, as set forth and defined in Section 7 of the
Separation Agreement and the restrictive covenants described in Section 4
of the Separation Agreement) is hereby incorporated and made a part of
this Final Separation Agreement. Employee affirms that Employee
has been paid and has received all leave (paid or unpaid), compensation,
wages, bonuses, commissions, and benefits to which Employee may be
entitled (other than payments to be provided on or after the Termination
Date in accordance with the Separation Agreement and this Final Separation
Agreement) and that no other leave (paid or unpaid), compensation, wages,
bonuses, commissions and benefits are due to Employee (other than payments
or benefits to be provided on or after the Termination Date in accordance
with the Separation Agreement and this Final Separation
Agreement). Employee agrees that, with Employee's execution of
this Final Separation Agreement (and upon the provisions of this Final
Separation Agreement becoming effective and enforceable after the
revocation period described in Section 3 hereof has passed), the release
of Claims in Section 7 of the Separation Agreement shall (subject to any
exceptions therein) cover any and all Claims associated with Employee's
entire employment with Brookdale and Employee's actual separation from
such employment, including, but not limited to, any Claims arising from
the date on which Employee initially signed the Separation Agreement
through Employee's last day of employment with
Brookdale. Brookdale for itself, its officers, directors,
successors, affiliates, agents, employees and assigns, both in their
individual and representative capacities, hereby voluntarily, knowingly
and willfully forever releases and discharges Employee, Employee's agents,
attorneys, representatives, heirs and assigns from any and all claims,
whether or not known, accrued, vested or ripe, that Brookdale has or may
have against Employee arising from or in any way related to Employee's
service with Brookdale or any of its affiliates up to and including the
date of execution of this Agreement or the termination of that employment
relationship in accordance with the contractual provisions of this
Agreement, including, but not limited to, any such claim for an alleged
violation of any federal, state or local law, regulation or ordinance; any
claims arising out of or related to an express or implied employment
contract (including, without limitation, the Employment Agreement) or a
covenant of good faith and fair dealing; any public policy, contract,
tort, or common law; or any allegation for costs, fees, or other expenses
including attorneys' fees incurred in these matters. Notwithstanding the
foregoing, nothing in this Final Separation Agreement shall release or
waive any rights or claims Brookdale may have (i) under the terms of this
Final Separation Agreement, (ii) under the terms of that certain Secured
Non-Recourse Promissory Note dated as of October 2, 2000 (as amended to
date) evidencing a loan from Brookdale and/or one of its affiliates to
Employee, which the parties
acknowledge
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shall
remain outstanding and unmodified by the terms of this Final Separation
Agreement, or (iii) as a result of any unlawful or fraudulent conduct
by Employee.
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2.
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Subject
to this Final Separation Agreement having been completely executed and
delivered to Brookdale, Employee's outstanding restricted shares subject
to the 2005 Agreement and the 2007 Agreement shall become fully vested on
the Termination Date and shall be delivered to Employee on the
Termination Date (the "Final Separation
Payment"). Employee agrees that the Final Separation Payment is
consideration in addition to any amounts to which Employee is already
entitled and that this consideration is adequate and satisfactory in
exchange for the assurances Employee makes in this Final Separation
Agreement.
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3.
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Employee
acknowledges Employee has been given more than twenty-one (21) days to
consider entering into this Final Separation Agreement and that Employee
has seven (7) days after Employee's execution of this Final Separation
Agreement to revoke such execution. Any revocation within this
period must be submitted, in writing, to Brookdale Senior Living Inc., 000
Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxx, XX 00000, as
follows: "I hereby revoke my acceptance of our Final Separation
Agreement." The revocation must be personally delivered to Brookdale's
General Counsel or mailed to his office at the above address and
postmarked within seven (7) calendar days of execution of this Final
Separation Agreement. This Final Separation Agreement shall not become
effective or enforceable until the revocation period has
expired. If the last day of the revocation period is a
Saturday, Sunday, or legal holiday, then the revocation period shall not
expire until the next following day which is not a Saturday, Sunday, or
legal holiday. No provision of this Final Separation Agreement, except the
vesting and delivery of Employee's restricted shares pursuant to Section 2
hereof, shall become effective or enforceable, until Employee's right of
revocation has been fully
extinguished.
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4.
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Employee
acknowledges Employee's last day of employment with Brookdale coincided
with or preceded Employee's signing of this Final Separation
Agreement.
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5.
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In
the event of Employee's death prior to the execution of this Final
Separation Agreement, it may be executed by a representative of Employee's
estate.
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Employee
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By:
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Xxxx
X. Xxxxxxx
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Date:
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Date:
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